Deposits, home inspections, legal fees... Whenever I start working with a new client I go though the list of closing costs that they need to budget for. One of the biggies is Land Transfer Tax.

Unless you live in Alberta, Saskatchewan, or rural Nova Scotia, land transfer taxes (or property purchase tax) are a basic fact of life. These taxes, levied on properties that are changing hands, are the responsibility of the purchaser. Depending on where you live, taxes can range from a half a per cent to two per cent of the total value of the property.

Many provinces have multi-tiered taxation systems that can prove complicated. In Ontario, for example, .5 per cent is charged on the first $55,000, 1 per cent is charged on $55,000 - $250,000, while the $250,000 - $400,000 range is taxed at 1.5 per cent. On a $300,000 purchase, for example, your total tax bill is $2,975.00.

If you're purchasing a property in the city of Toronto, you'll need to factor in an additional Land Transfer Tax. On that same $300,000 purchase, you're looking at another $2,725.00. That brings your tax total to $5,700.00. This isn't chump change.

Are you a first time buyer?

First-time buyers of new and re-sale homes are eligible to receive rebates of the provincial and Toronto land transfer taxes. The maximum provincial land transfer tax (LTT) rebate for first-time buyers is $2,000 and the maximum Toronto LTT rebate for first time buyers is $3,725. Check out the Toronto Real Estate Board's website for a more detailed breakdown of these rebates and whether or not you're eligible to receive them.

The following chart illustrates Land Transfer Taxes by province.

ONTARIO

Land Transfer Tax ( go to calculator )
Up to $55,000 X .5 % of total property value
From $55,000 to $250,000 X 1 % of total property value
From $250,000 to $400,000 X 1.5 % of total property value
From $400,000 up X 2 % of total property value

BRITISH COLUMBIA

Property Purchase Tax
Up to $200,000 X 1 % of total property value
From $200,000 up X 2 % of total property value

MANITOBA

Land Transfer Tax
Up to $30,000 N/A
From $30,000 to $90,000 X .5 % of total property value
From $90,000 to $150,000 X 1 % of total property value
From $150,000 up X 1.5 % of total property value

QUEBEC

Transfer Tax
Up to $50,000 X .5 % of total property value
From $50,000 to $250,000 X 1 % of total property value
From $250,000 up X 1.5 % of total property value

NOVASCOTIA

Land Transfer Tax

Halifax Metro

1.5 per cent on total property value

Outside Halifax County

Check with local municipality.

For access to a Land Transfer Tax Calculator and other financial tools, visit my website here.

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.